David Kolb: Elephants stampede when the word 'reform' is heard

David Kolb
Congress recently passed the most sweeping financial regulation and reform bill enacted since the Great Depression of the 1930s, as you have been aware.

That this was done with only the limpest GOP support goes without saying.

The Party of No opposes anything and everything the Democrats and President Barack Obama have tried to do to clean up the extraordinary mess left behind in the wake of the previous presidency.

Only three of 178 House Republicans voted for the Wall Street Reform and Consumer Protection Act of 2010. These stalwarts were matched by three Republican senators out of 41.

Yet even that wasn’t enough. It took a last-second trip to Washington, D.C., by West Virginia’s new Democratic senator, Carte Goodwin, to provide the 60th vote to overcome still another Republican filibuster attempt to kill the bill.

Why would the elephants have wanted to kill this legislation?

Good question.

All I can figure is that the right wing’s biggest whaaa-whaaa-whaaa refrain this campaign season of “I want my country back!” has great resonance within the breasts of the die-hards who now control the party.

What they mean, of course, in wanting “their country back,” is they want the one they enjoyed under the leadership of their heroes, George W. Bush and Dick Cheney.

Yes, those were heady days for neo-con Republicans in charge of Congress, the White House and the Supreme Court:

• Two undeclared wars going full blast, off the books and unpaid for.

• Budget-busting tax cuts for the very richest Americans.

• Unfunded goodies that added billions to the nation’s deficit, like Medicare Part D.

• “Mission Accomplished.”

• The wipeout of the budget surplus combined with the doubling of our national debt.

• “Heckuva job, Brownie.”

• Packing key federal agencies like the Federal Emergency Management Agency, the Department of Justice and the Minerals Management Service with incompetents and cronies.

• The orgy of deregulation in our financial markets that permitted the economic meltdown that almost ruined America.

W., our former honorary vice president, is happily reveling in his retirement these days although he seems unwilling to lead the fight to renew the wonder years under tea party presidential front-runner, ex-half-term governor Sarah Palin.

Cheney, our former honorary president, although emerging from his favorite undisclosed location every now and then to lash out at his critics, is too unhealthy to get back on the national ticket, as much as he’d like to, I’m sure.

But their horrendous legacy remains.

“Brownie” may be gone but the two wars are still going and the “mission,” whatever that was, remains unaccomplished; the tax cuts haven’t expired; the worst of the Bush appointees haven’t been rooted out yet; and our fragile economy continues to teeter on the brink.

The good news is, several huge steps forward have been taken to rein in the Wall Street sharks thanks to the passage of financial reform:

• A Financial Stability Oversight Council will be tasked with identifying risky practices that may be threatening the economy.

• A Consumer Finance Protection Bureau is to be set up under the umbrella of the Federal Reserve to police the individual market for loans and other financial products.

• An Office of Thrift Supervision is being folded into the Office of the Comptroller of the Currency and will be given expanded power to oversee banks.

• A Federal Insurance Office will be set up at the Treasury Department to monitor the insurance industry and step in if it believes state regulators are dropping the ball.

• The Commodity Futures Trading Commission, which oversees the derivatives market, and the Securities and Exchange Commission, the federal government’s beat cop on Wall Street, will all be given expanded regulatory roles.

One of the most significant components of the new law is the streamlining of banking regulation, which up to now has been a mish-mash of unaccountability.

After more than six decades of warnings that such a system would ultimately fail the average American who depends upon his or her bank to remain a stable and dependable institution making sound financial decisions, the new bill will put the right agencies in charge.

Among the biggest and most important changes:

• The Federal Deposit and Insurance Corporation, the trusted agency that protects our money in our banks, will now regulate state banks and thrifts of all sizes and bank holding companies of state banks with assets below $50 billion.

• The Office of the Comptroller of the Currency under the Treasury Department will regulate national banks and federal thrifts of all sizes and the holding companies of national banks and federal thrifts with assets below $50 billion.

• The Federal Reserve will regulate bank and thrift holding companies with assets of more than $50 billion, and assume a pro-active responsibility for finding risk throughout the system and report semi-annually to Congress.

There are many other, vitally important provisions in this bill, that I haven’t touched on. In fairness, the GOP would assert these all are damaging rather than helpful.

However, I would point out that in the wake of reform passage, Wall Street hasn’t collapsed again, and neither has the economy taken a jump off the cliff as it did in the apocalyptic last days of the Bush-Cheney regime.

Indeed, our worried financial barons, in such danger of fainting, seem to be holding up rather well in spite of all Fox News' dire predictions about the effects of the bill.

Upset Republicans have been blubbering over what the bill has left out, namely its failure to address the ills that beset the federal mortgage agencies known as Fannie Mae and Freddie Mac.

These agencies are their Rush Limbaugh-scripted fall guys for the financial crisis since Fannie and Freddie generally help poor people.

Well, if the GOP wanted a better bill or even a different bill, it should have cooperated in its creation.

And since th GOP completely controlled Washington for more than six years, the party might even have crafted its own bill. There certainly was nothing preventing them from doing that.

But as Austin Powers might have said: “Reform ain’t their bag, baby!”

David Kolb is former editorial page editor of The Muskegon Chronicle. E-mail: writersgroupllc@aol.com